The Living Profit

Zonitics.com ^ | March 19, 2002 | Edward Boyd

[John Jorsett]

There's been much ado about so-called "living wage" ordinances lately. Despite my initial hesitation, I'm beginning to come around to the idea. However, I don't think that a "Living Wage" goes far enough.

According to the U.S. Small Business Administration, small businesses account for 51% of all private sector jobs, but over 60% of all small business fail within six years. Obviously, this means that the majority of small business owners are going bankrupt while an elite cadre of wealthy business owners make all of the profits.

I think that we can all agree that it is unacceptable in a country of such wealth for so many hardworking businessmen and women to work their way into bankruptcy while the minority of rich businessmen achieve huge success. Moreover, each business failure means list jobs and more workers forced into unemployment. It simply isn't fair for some to do so well, while both owners and employees suffer merely because they can't produce profits.

Accordingly, I propose that state and local governments across the United States adopt "Living Profits" laws. These laws would guarantee each business a minimum of 5% profits per year without requiring one dime of taxpayer money. The laws would work by forcing the rich successful small businesses to help out their competitors.

1. Each business that has recorded a profit of 5% or more in the preceding quarter and that has a competitor that didn't record a profit of at least 5% in the preceding quarter will be required to pay 75% of excess profits (over 5%) into a fund. The fund will be administered by the local government and distributed to failing businesses to bring them up to 5% profits. If the fund has excess money after providing the guaranteed profit level, the excess will be retained as insurance for the event that no businesses have excess profits.

2. Alternatively, a small business with excess profits that has a competitor in geographic proximity could agree to shut down at least two work days per week until the competing business has achieved reasonable profits.

I was able to borrow a list of reasons to support the Living Profits initiative from the Western Pennsylvania Living Wage Campaign's website. Surprisingly, only minor changes (mainly replacing "poverty" with "bankrupcty") were needed. Here is my adapted list of reasons to support the Living Profits initiative:

• Reducing taxpayer costs and the need for services that subsidize unsuccessful businesses – like bankruptcy laws, foreclosure auctions, unemployment insurance, and so on.

• Keeping business from bankruptcy will expand the tax base.

• Ensure that businessmen will be able to support themselves and their families and keep their workers employed.

• Helping us reclaim the time we’ve lost to spend with our families and communities [no change needed].

• Creating improved employee morale and lowering employee turnover [no change needed].

• Creating a level playing field for employers who pay (or want to pay) decent wages and provide good benefits to their employees [no change needed].

• This is a basic issue of morality – it goes against Christian, Jewish, Islamic and other faith traditions’ morality for businesses to drive each other into bankruptcy.

• While some competition is called for, excessive competition leads to bankruptcy and lost jobs.

• The right to a decent business with a living profit is a civil rights and human rights issue.

• Bankruptcy breeds other problems in communities such as substance abuse, crime, etc.

• Much of the moral decay in communities comes from severe and grinding bankruptcy.

• Human beings’ spiritual nature is violated when they are denied basic success, despite their hard work.

• Living Profits laws help raise the floor of wages and benefits by reducing the incentive to try to reign in costs. When businesses focus too much on cutting costs (i.e. wages and environmental protections), workers suffer. By taking away most of an employer's excess profits, there won't be as much incentive to cut costs and wages will rise.

You heard it here first. Now join the effort to establish Living Profits ordinances in your community. Next we will campaign to raise the minimum profit.

[Zonitics]

Thanks for posting it. I hope that people will see the wisdom - unchecked competition is destroying small business in this country.

[John Jorsett]

I love pieces like yours that illustrate the absuridity of the other side's position by going them one better. I plan to talk up the Living Profit wherever I can.

[Logophile]

You heard it here first. Now join the effort to establish Living Profits ordinances in your community. Next we will campaign to raise the minimum profit.

After that, we'll pass Guaranteed Happiness laws!

[Frumious Bandersnatch]

I believe that the actual figures are something like 90% of all businesses fail within the first 5 years.  Of these, around 90% fail because of lack of forethought and planning.

So, if you do your planning properly, you actually have a 90% chance of success.

So how wise is his redistributionist policy?  Not very.  The problem isn't unchecked competition, but rather unchecked protectionism.

[Stultis]

LOL!

But, should I be laughing? Today's satire could be tomorrow's Democrat policy initiative.

[boris]

Hmm. This would violate a fundamental law of the Universe: Boris' law of conservation of Italian Restaurants.

The number of Italian Restaurants is constant; each time one closes another one opens somewhere. The "IR" number of the Universe is preserved, sort of like Boson number...

--Boris

[MarkWar]

>Accordingly, I propose that state and local governments across the United States adopt "Living Profits" laws.

As I was laughing at your funny post, it occurred to me that it actually might not be too bad an idea if there was something like an "initiative fund" which in some way rewarded people who, at least, took some initiative and tried to make a go of something.

Of course, just starting up a small business in itself shouldn't count. Somebody would have to figure out a way to weed out people just going through the motions, and people coached by do-gooders, etc. But it seems to me that people who have energy and passion and self-direction actually are a resource to a society at large, and, one way or another, we all benefit from having such people around. If such people do fail in this or that particular instance, it is to our own benefit to find a way to keep such people around, rather than driving them to suicide or brainless day-jobbing...

Of course, the hard part is figuring out how to separate the real deals from the posers.

I have no idea how it could be managed. My only point is that, if we're day dreaming here, it would be a good thing if such a thing could be managed...

Mark W.

[CaliforniaDreamer]

Are you sure you didn't get this from the Boxer staff?

[Zonitics]

The SBA says that it is 60% fail within 6 years. How dare you be so willing to consign 90% of entrepeneurs to the poor house. You're so heartless.

[Mind-numbed Robot]

It simply isn't fair for some to do so well, while both owners and employees suffer merely because they can't produce profits.

So true, so true. But first, let's work on the ugly/attractive problem. It is not fair, even cruel, that some people are attractive while others have to struggle through life being ugly and unwanted. To be fair, the attractive should have to pay for plastic surgery for the ugly, or, conversely, the ugly should get to mar and maim the attractive in order to make them ugly. It is only fair.

[ppaul]

A "Living Profit"

[Teacher317]

a living allowance, a living retirement income, a living college stipend, a living food allotment, a living luxury allotment...

a living conjugal allotment? We have NEEDS! =^)

[Teacher317]

Wasn't that a short story by Robert A. Heinlein?

[Frumious Bandersnatch]

The SBA says that it is 60% fail within 6 years. How dare you be so willing to consign 90% of entrepeneurs to the poor house. You're so heartless.

That's a remarkable improvement then, because not too long ago it was a 90% failure rate.  And do I consign 90% to the poor house, or do I suggest that 90% should succeed but fail to do so because of the lack of proper forethought and planning?  I still stand by my assertion that misguided protectionism hurts more than it heals.

[Logophile]

But first, let's work on the ugly/attractive problem. It is not fair, even cruel, that some people are attractive while others have to struggle through life being ugly and unwanted. To be fair, the attractive should have to pay for plastic surgery for the ugly, or, conversely, the ugly should get to mar and maim the attractive in order to make them ugly. It is only fair.

What about the intelligent/stupid problem? It is not fair, even cruel, that some people are intelligent while others have to struggle through life being stupid.

Perhaps intelligent people should be forced to wear headphones that continually play speeches from our leading Democrat politicians.

[Zonitics]

You do understand that it is satire, don't you?

[Frumious Bandersnatch]

You do understand that it is satire, don't you?

Got me on that one!!!  No, I didn't know that.  Oh well, 2 points to you. :)

[aardvark1]

Are you running for President? Where can I send my campaign contributions--limited though they may be?

[Zonitics]

Based on my e-mail you weren't alone. Next time I'll put a "/satire" tag at the end.